Child labor in the New Economy of Asia
Howe Chung Wan
Child labor is a complex problem whose roots are deeply embedded in cultural,
social and economic structures and traditions. It is a pervasive problem, especially in the
developing countries of Asia. An estimated one to two hundred million children was
working around the world — 95 percent of them in developing countries. Asia accounts
for 61 percent of the world’s total child employment.1 Child labor is a global issue, and
many international bodies such as the International Labor Organization, United Nations
Children’s Fund (UNICEF), the World Bank and other non-governmental organizations
have stepped up their global efforts to cope with child labor issues. The role of
international bodies and multilaterals are crucial in the fight against child labor in Asia.
In its most harmful form, child labor impairs the physical and mental
development of the children. Child labor is especially prevalent in rural areas where the
capacity to enforce minimum age requirements for schooling and work is lacking. There
is no international agreement defining child labor. Countries not only have different
minimum age work restrictions, but also have varying regulations based on the type of
labor. This makes the limits of child labor very ambiguous.
In the advent of the New Economy, opting out of the global market is not a
solution towards economic success. Nations lacking foreign direct investments (FDI)
often experience extreme rates of poverty and repressed human rights, and have
economies heavily dependent on government regulations.2
1
International Labor Office 1996a, Child Labor: Targeting the Intolerable. International Labor
Conference, Geneva, 86th Session 1996.
2
World Investment Report 1999: Foreign Direct Investment and the Challenge of Development, United
Nations, New York and Geneva, 1999, pp. 45–73. Bryan T. Johnson, Kim R. Holmes, and Melanie
1
One of the most important reasons in the use of child labor was poverty in
families, forcing children to serve as primary household earners. The reduction of income
poverty occurs with growth in average living standards.3 Developing nations need help to
build the capabilities that will enable them to become part of the new world. The rate of
children working decreases as per capita GDP of the country rises.4
This paper serves to examine the importance of multilaterals and the world
economy to reduce child labor globally. Attributes and reasons for child labor are
discussed in detail to explore how the new economy can play a part to resolve child labor
issues. In particular, the paper analyzes the flow of capital and foreign direct investments
into specific developing nations in Asia. The purpose is to address the links and
relationships between the global economy, foreign direct investments, poverty and
standard of living with respect to child labor. Real world examples are drawn from Asia
since Asia accounts for most of the world’s child labor.
Child labor statistics
Child labor force participation rates are much higher in rural than in urban areas,
and three-quarters of working children work in the family enterprise. Child workers in
export industries (such as textile, clothing, carpets, and footwear) are relatively few
compared with those employed in activities geared to domestic consumption. Probably
Kirkpatrick, 1999 Index of Economic Freedom, The Heritage Foundation and Wall Street Journal, 1999,
pp. xix-xxviii.
3
Aaron, Carl, The Contribution of FDI to Poverty Alleviation, Foreign Investment Advisory Service
(FIAS)
4
World Development Report 1999/2000, Child Labor: How much? How damaging? And what can be
done? Oxford University Press, Inc. New York, September 2000, p. 62
2
less than five percent of child laborers are employed in the export manufacturing or
mining sectors, and only one to two percent are employed in export-oriented agriculture.5
In a survey conducted on six countries by the International Program on the
Elimination of Child Labor (IPEC which is headed by ILO), the incidence of child labor
was found to decline with per capita GDP. The labor force participation rate of children
aged 10-14 years is extremely high at thirty to sixty percent in countries with per capita
income of $500 or less (at 1987 prices). But it declines quite rapidly to ten to thirty
percent in countries with incomes between $500 and $1,000. Also child labor seemed to
be related to the structure of production. The higher the share of agriculture in GDP, the
higher the incidences of child labor.6
According to the ILO, the term "child labor" generally refers to any economic
activity performed by a person under the age of 15. Not all work performed by children is
detrimental or exploitative. Child labor does not usually refer to "light work" after school
or legitimate apprenticeship opportunities for young people. Nor does it refer to young
people helping out in the family business or on the family farm. Rather, the "child labor"
of concern is employment that prevents effective school attendance, and which is often
performed under conditions hazardous to the physical and mental health of the child.
According to the World Education Report 1998 and Demographic Yearbook 1995, and as
reported by Directorate of Adult, slightly less than one third of World’s illiterate aged 15
years and above are in India — 46 percent of India’s population aged 15 years and above
5
International Labor Office 1996a, Child Labor: Targeting the Intolerable, International Labor
Conference, Geneva, 86th Session 1996.
6
Peter Fallon and ZafirisTzannatos, Child Labor: Issues and Directions for the World Bank.
http://wbln0018.worldbank.org/HDNet/HDdocs.nsf/f879b8f845ed3915852566500051f549/e4bcc001dba99
537852566b1000a86fa?OpenDocument.
3
are illiterate.7 Dropout rates have decreased significantly from 1960 to 1997, however,
dropout rates at elementary stages for children up to 14 years of age are still about 55
percent in 1997.8 The Indian national survey sponsored by the CBCI (Commission on
Justice, Development and Peace) included 6,997 domestic workers who were interviewed
in 12 towns/cities and 12 districts of 8 states in India. Child domestic workers comprise
one sixth of this unorganized sector. Karnataka State has the highest percentage (30.48
percent) of child labor. Calcutta, Kerala and Ranchi seem to be more sensitive to the
child labor laws and have the lowest percentage — about 16 percent of domestic workers
below the age of 18 years.
According to an ILO report, 13 million child workers were estimated to be in
India in 2000. The ILO estimates that for the world as a whole, 68 million children aged
less than 15 years were working in 2000. India's share in child labor works out to be
about twenty percent.9 But the ILO study points out that the various figures of child labor
may be an underestimation since in some countries, young workers less than 15 years of
age are not included in labor force statistics.10 In other countries, young workers both
work and go to school and are rarely considered as being part of the labor force. Again
the statistics cover only those youngsters who have a fixed job and thus exclude the
majority of those who work only occasionally. Dr Irwanto, Professor of Child
Psychology at the Catholic University of Indonesia, provided evidence that the ILO
research on child labor statistics was incomplete, because ILO obtained information from
7
Directorate of Adult World, Education Report 1998 and Demographic Yearbook 1995, United Nations,
New York.
8
Web site of the Ministry of Education – Elementary Education, Department of Education, Government of
India. http://www.education.nic.in/htmlweb/edusta.htm
9
Bureau of Statistics, International Labor Organization, Economic Active Population Volume I, Asia, STAT
Working Papers, (1950 – 2010), Geneva, 1996, p.78.
4
a few departments in the Ministry of Labor (Indonesia) rather than surveying the general
public in the country.11 It is impossible to make an accurate estimate of the numbers
employed, for the simple reason that, in most countries child labor is clandestine, it is in
the interest of all parties concerned to conceal it. There is no reason to doubt that ILO
survey suffers from the same limitations.
Government policies and child labor laws
The total number of ‘economically active’ children in Nepal is estimated to be at
2.7 million according to a survey by the Centraal Bureau voor de Statistiek (CBS) of
Netherlands.12 This is approximately 60 percent of Nepal’s population between the ages
of eight and sixteen years. In an interview I conducted with Sumnima Tuladhar, a
Program Officer with the Child Workers in Nepal Resource and Information Center, I
asked him about the reasons why child labor was still a major problem in Nepal and
whether it was due to cultural practices or globalization. He stated that, “ Poor political
commitment, ineffective implementation of laws and lack of systematic monitoring and
follow-up of existing laws… are some of the immediate factors of the child labor
problem.”13 The Nepali government has taken some initiatives to fight the child labor
problem. The Ministry of Labor has signed the Memorandum of Understanding with
international bodies such as the ILO (IPEC) and UNICEF. These commitments are
reflected in the provisions made by the 1990 Constitution of Nepal, the 1991 Labor Act,
and the Children’s Act of 1992. The government also ratified the UN Convention on the
10
Child Domestics Survey in India: Summary of a national survey sponsored by the CBCI, Commission on
Justice, Development and Peace. http://www.cwa.tnet.co.th/domestic/pages27-29.htm
11
Protection of children in the Indonesian Constitution, Kompas, 10 March 2000.
5
Rights of Children and the ILO Convention 138 of Minimum Age. The 1990 Constitution
includes provisions to help protect the rights of children, especially with regards to
slavery, human trafficking, serfdom and forced child labor.
Progress on child labor issues is evident in Indonesia, especially with the
ratification of ILO Convention 182 on protection of child labor. Indonesia was the first
country in Asia to have ratified the convention into their constitution.14 However, a report
from one of the national newspapers of Indonesia, Kompas on 2nd June 2000, revealed
that ratification of ILO Convention 182 was ‘performed’ for the sake of international
politics.15 The Director of the National Commission of Child Protection, Arist Merdeka
Sirait, felt that President Abdurrahman Wahid could involve the police and military in
enforcing the laws regarding child labor issues. He believed that eradication of child
labor was not about politics but required a system that involved many aspects of the
government and formulating strategies together. The Commission, he felt, should have
the legal powers to directly give aid to children in families in financial crisis, or even
relocate children from families with domestic violence or evidence of abuse.
Article 24 of the Indian constitution clearly stated “No child below the age of
fourteen years shall be employed to work in any factory or mine or employed in any
hazardous employment.” 16 Article 39(e) directed state policy such “that the health and
strength of workers . . . and the tender age of children are not abused and that citizens are
12
Bijaya Sainju, Child Labor in Nepal: Realities and Challenges.
http://www.cwa.tnet.co.th/booklet/Nepal.htm
13
Sumnima Tuladhar, email to Howe Chung Wan on October 04, 2000.
14
ILO Office in Jakarta, The Ratification of Convention No. 182 of the ILO.
http://www.ilo.org/public/english/region/asro/jakarta/conv182.htm
15
Kompas, 2nd June 2000. http://www.kompas.com
16
Constitution of India cited in Jain, S. N. Legislation and Government Policy in Child Labour, In Child
Labour and Health: Problems & Prospects, edited by U. Naidu and K. Kapadia. Bombay: Tata Institute of
Social Sciences, 1985, p. 218. http://www.geocities.com/CollegePark/Library/9175/inquiry1.htm
6
not forced by economic necessity to enter avocations unsuited to their age or strength.”17
In August 1994, the former Prime Minister Narasimha Rao announced his proposal of an
Elimination of Child Labour Programme. This program aimed to end child labour for two
million children in hazardous industries as defined in the Child Labour Act of 1986, by
the year 2000.18 Indeed, all of the policies that the Indian government has in place are in
accordance with the Constitution of India, and all support the eradication of child labor.
However, as in Nepal and Indonesia, enforcement of these policies was a major problem
in the government’s efforts and hence child labor still existed. In 1996, the Human Rights
Watch reported the government efforts in India, “A glaring sign of neglect of their duties
by officials charged with enforcing child labor laws is the failure to collect, maintain, and
disseminate accurate statistics regarding enforcement efforts.”19
Reasons for child labor and societal attitudes
In general, the principal reason why children work is poverty. Though child
workers are not well paid, their contribution to family income (sometimes as much as 20
– 33 percent) can be essential to its survival.20 In general, children are paid much less
than the prevailing minimum wage and are not organized in trade unions. According to a
report by the ILO in 1991, the continuing demand for cheap labor, fuelled by growing
17
Constitution of India cited in Human Rights Watch, The Small Hands of Slavery - Bonded Child Labor in
India, New York: Human Rights Watch, 1996, p. 28.
18
Human Rights Watch, The Small Hands of Slavery - Bonded Child Labor in India. New York: Human
Rights Watch, 1996, pp. 119-120.
19
Ibid, p. 131.
20
Child Labor, The Nature of the Problem: Some Basic Facts, Unicef Programs on Child Protection.
http://www.unicef.org/programme/cprotection/labour.htm. Syed, K.A., A. Mirza, R. Sultana and I. Rana.
Child Labor: Socioeconomic Consequences. "Pakistan and Gulf Economist 1991, 10: 36-39. Unicef claims
child labor contribution amounts to 25 percent, while Syed et al maintains that child labor contribution to
family income comes up to 33 percent.
7
competition in the global market, further aggravates the child labor problem.21 Employers
recruit children (at an average age of ten) because the children are controllable,
disorganized, accept lower wages and accept flexibility of tasks and longer working
hours.22 School attendance by a child is also highly correlated with family income.23
Therefore, when children drop out of school to work, it is not necessarily because of
irresponsible parenting; it may be due to the family's financial situation.
Sumnima Tuladhar described the reasons for child labor in Nepal, “… underlying
factors are … the inequitable distribution of land; poor access to resources and
production, … gender inequity; lack of people centered and sustainable development
programs and environmental degradation … thus causing family disintegration.
Widespread illiteracy, ignorance of parents about child rights, … growing adult
unemployment and lack of alternatives for survival in the rural areas are other immediate
factors of child labor problem.”24 In 1998, the adult illiteracy rate (as a percentage of 15
and above) in Nepal was 43 percent for males and 78 for females.25 A report by Child
Workers in Asia noted that child marriages and polygamy were still practiced in Nepal.
Therefore, family separation and desertion happen quite often, resulting in children
running away from home. Concerning environmental aspects, 84 percent of Nepal’s
population do not have access to sanitation, and 29 percent do not have access to safe
21
Sinclair, V. and G. Trah, Child Labor: National Legislation on the Minimum Age for Admission to
Employment or Work, in Conditions of Work Digest. (International Labor Office, Geneva) 1991, 10,1:19146.
22
Kekebew Ashagrie, Methodological Child Labor Surveys and Statistics: ILO’s Recent Work in Brief,
http://www.ilo.org/public/english/bureau/stat/child/childlab/htm June 1997
23
Ilon, L. and P. Moock. School Attributes, Household Characteristics and Demand for Schooling: A Case
Study of Rural Peru, 1991, International Review of Education 37,4: 429-452.
24
Sumnima Tuladhar, email to Howe Chung Wan on October 04, 2000
25
World Development Report 2000/2001, Attacking Poverty, Table 2. Quality of Life, p.277.
8
water.26 Unemployment of parents further aggravated the problem of child labor.
Education in Nepal is not compulsory; therefore parents could not be forced to send their
children to schools.27 From December 18th 2000 to January 5th 2001, I visited Kathmandu
Valley and the Langtang region north of Kathmandu. In villages of altitudes of
approximately 2500m and below such as in Dhumche, Syabru or Helambu region,
elementary schools for children up to 12 years of age were set up. However, in areas with
altitudes of 3000m and above, where the settlements were vastly spread out, like in
Langtang and Gosaikunda, children helped out in the farms and in village hotels, instead
of going to school. Hence, in mountainous and less economically developed regions of
Nepal, inaccessibility and distance were some reasons why children did not receive
formal education. A teacher I interviewed revealed that the Nepali government provides
for the building of school facilities, but school uniforms, textbooks and food during
school had to be provided by families. Therefore, only parents who knew the importance
of education would send their children to schools.
Rapid rural to urban migration is another cause of child labor. Families in the
rural areas leave for employment opportunities in the urban areas that often do not exist.
In 1950, 17 percent of the population of the developing world lived in urban areas. By the
year 2000 it is estimated that this proportion will increase to forty percent, and to 57
percent by the year 2025.28 Such drastic migrations into the urban areas led to family
problems such as parents deserting their families, forcing children into early employment.
26
United Nations, Human Development Report 2000, Human Development Index, Human Poverty in
developing countries, p.170.
27
Bijaya Sainju, Child Labor in Nepal: Realities and Challenges.
http://www.cwa.tnet.co.th/booklet/Nepal.htm
28
United Nations, Revisions, Global Estimates and Projections of Population by Age and Sex, New York
1989.
9
Education problems also contribute to child labor. A survey by the ILO in 1992
found out reasons cited by children who never attended school or those who dropped out
of school. The reasons included financial problems (e.g., forty percent of the dropouts in
one of the surveys gave this factor as a reason), need for participation in household
economic activities or in household chores, costs of schooling, distance to schools poor
school facilities and fear of teachers. The failure of schools to provide rewarding, quality
education to meet the needs of children contributes to the dropout rate and hence to the
growth of the child labor market. However, the survey showed that if the children had a
choice, a very high proportion of those who did not want to continue to work preferred to
pursue schooling.29
Children are often influenced into work by their parents. According to a study,
parents represent 62 percent of the source of induction into child employment. Children
make their own decisions to work only 8 percent of the time.30 Parents who find no use in
their children attending school will prefer to teach their children skills to supplement the
family income. Parents considered that their child’s work was very important in
supplementing the family income. Parental influence and obligation plays a large role in
determining child schooling and employment.31 India has the largest juvenile workforce
because 82 million children are not in school. This means that only a minority gets a
quality education. For example, only 54 percent of Indians over the age of 15 are
Kekebew Ashagrie, Methodological Child Labor Surveys and Statistics: ILO’s Recent Work in Brief.
June 1997. http://www.ilo.org/public/english/bureau/stat/child/childlab/htm
30
Syed, K.A., A. Mirza, R. Sultana and I. Rana. Child Labor: Socioeconomic Consequences. "Pakistan and
Gulf Economist 1991, 10: 36-39.
31
Tienda, M. Economic Activity of Children in Peru: Labor Force Behavior in Rural and Urban Context,
1979 Rural Sociology 44: pp. 370-391.
29
10
literate.32 This decreases to 33 percent in Bangladesh and 26 percent in Pakistan.33 In
developing countries, parents may have children because they can contribute
economically. In fact, children contribute more economically and are less of an economic
burden in developing countries than their counterparts in developed nations.34
Nonetheless, the cause of child labor is not always related to poverty. Research
conducted by the Action Aid Nepal in the Sindhuli district revealed that school aged
children from wealthy families were sent to work in carpet factories in Kathmandu.35
Cultural factors also play a role. A tradition of beginning one’s working life in
childhood, without the benefit of schooling, is passed on from one generation to the next,
perpetuating a cycle of poverty and illiteracy. For example in India, people of the lower
castes are expected to perform manual labor and therefore not suitable to attend school.
This kind of social separation perpetuates child labor. Cultural beliefs that educated
women will not get married and have children restrict women from gaining access to
education and promote child labor.36 So called scheduled caste children such as the Kami,
Dam, Pode and Sakri in Nepal are often not encouraged to go to school with other
children.37 Even in a developed country such as the United States, in Pennsylvania, under
Amish tradition, youngsters worked in apprenticeship settings after the eight after eight
grade. For years that didn’t conflict with federal law because the livelihood of the Amish
32
Directorate of Adult World, Education Report 1998 and Demographic Yearbook 1995, United Nations,
New York.
33
Weiner, M. The Child and the State in India. Princeton, New Jersey: Princeton University Press. 1991.
34
Lindert, P. Child Costs and Economic Development" In R.A. Easterlin, ed., Population and Economic
Change in Developing Countries, 3.
. The University of Chicago Press, Chicago, 1976.
35
Bijaya Sainju, Child Labor in Nepal: Realities and Challenges.
http://www.cwa.tnet.co.th/booklet/Nepal.htm
36
Bequele, A. and J. Boyden. Working Children: Current Trends and Policy Responses, International
Labor Review 1988 127, 2: pp. 153 – 171.
37
Bijaya Sainju, Child Labor in Nepal: Realities and Challenges.
http://www.cwa.tnet.co.th/booklet/Nepal.htm
11
was rooted in agriculture and farms are exempt from child-labor laws. 38 But with
growing costs of farming, many families had turned to woodworking and other small
trades. Federal labor laws prohibit children younger than 16 from working in
manufacturing operations and children younger than 18 from working in other hazardous
occupations.
Child labor in the New Economy
Globalization has economic, political and cultural dimensions, all of which can
have a social impact. Economic globalization can be simply defined as a process of rapid
economic integration among countries. It has been driven by the increasing liberalization
of international trade, and by freer capital flows. The process manifests itself mainly
through an intensification of activities in the following areas: international trade in goods
and services; capital flows (FDI and portfolio); the role of multinational enterprises
(MNE); the reorganization of production networks on an international scale and the
adoption of new technologies, including information technology.39
Foreign direct investment (FDI) involves a long-term relationship and reflects a
lasting interest and control of domestic assets by foreign investors. Theoretical
considerations and empirical evidence suggest that globalization has the potential to
increase peoples' welfare. Most cross-country studies conclude that increased trade and
foreign direct investment flows are, at least in the long run and in most cases, correlated
with higher rates of economic growth and productivity increases for the economy as a
38
The Christian Science Monitor, Amish seek exemption from federal ban on child labor, December 4,
2000. http://www.csmonitor.com/durable/2000/12/04/p5s1.htm
12
whole.40 In a study by the Foreign Investment Advisory Service, the relationship between
FDI and (income) poverty reduction can be broken into two elements — the relationship
between FDI and (income) growth on one hand and that between growth and poverty
reduction on the other. It was generally found that inflows of FDI encourage more rapid
economic growth.
Sumnima Tuladhar believes that the reasons for the existence of child labor in
Nepal were:
In Nepal, the problem of child labor is due to existing unfair and exploitative labor
relations, socio-economic and political structure of the society and a very big gap
between the rich and poor. In Nepal the direct effect of globalization in this regard is yet
to be experience but of course, the current trend of globalization is a key cause of so
many problems including the widening gap between rich and poor, north and south. 41
The role of the world economy and globalization in the developing countries, especially
those with the problems of poverty is becoming a pertinent issue in defining the roles of
the poorer nations in the world economy.
Senator Tom Harkin introduced the US Child Labor Deterrence Bill in 1992.
According to a report by the American Federation of Labor - Congress of Industrial Organizations
(AFL-CIO):
The Senate unanimously passed the International Labor Organization (ILO) Convention
on the 182 Elimination of the Worst Forms of Child Labor. The Convention was
approved in Geneva by ILO member states on June 17, 1999… the Senate overwhelming
approved (96-0) a Harkin amendment to the Africa Trade Bill which would deny trade
benefits to countries that did not meet or effectively enforce the standards in ILO
Convention 182 for the Elimination of the Worst Forms of Child Labor.42
There has been considerable international discussion on the controversial issue of
core labor standards and international trade. This is largely due to the linkage that is made
39
International Labor Organization, Working Party on the Social Dimensions of the Liberalization of
International Trade, Country studies on the social impact of globalization: Final report, 276th Session,
Geneva, November 1999.
40
Ibid.
41
Sumnima Tuladhar, email to Howe Chung Wan on October 04, 2000.
13
in some quarters between access to industrialized country markets by developing
countries and their observance of minimum labor standards. Many citizens and
governments in industrialized countries feel that developing countries benefit from unfair
competition when they export goods and services without meeting minimum labor
standards. In the developing world, on the other hand, many feel that linking trade and
labor standards is done for protectionist purposes. It is not that those in the developing
world are opposed to labor standards; rather, they believe that establishing a direct link
between labor standards and trade is simply an excuse to restrict the flow of goods and
services from developing to developed countries. In the recent ILO Declaration on
Fundamental Principles and Rights at Work, child labor was deemed detrimental to
development, since it means that the next generation of workers will be unskilled and less
well educated. In today's increasingly globalized economy, this has especially negative
consequences, since, as pointed out in the present report, a skilled and educated labor
force is critical to economic development, increasing incomes and social progress.
Anti-globalists argued that global corporations ignore abuses of human rights,
such as employing child labor. The United Nations estimated that tens of millions of
children were trafficked around the world as bonded labor or sex slaves; hundreds of
thousands of children are forcibly recruited as soldiers in armed conflict.43 In China,
companies often confiscated young workers’ identification cards to prevent them from
leaving and seeking employment elsewhere.
42
Statement of Senator Tom Harkin (D-IA), Senate passes ILO Child Labor Convention, Website of U.S.
Senator Tom Harkins of Iowa, http://www.senate.gov/%7Eharkin/releases/99/11/1999B05B18.html.
43
Barbara Crossette, Clinton Signs Agreement To Help Protect Children, New York Times, July 6, 2000,
A11.
14
As a matter of fact, empirical evidence from a World Bank research paper
demonstrated no relationship between labor standards and export performance or FDI.44
Therefore, an influx of FDI does not have any effect on the core labor standards of
developing countries. A very small percentage of child labor is involved in the formal
sectors of industries that are directly related to foreign investments.
Global economy’s link to child labor
The incidence of child labor has been falling on a global basis, but there are
different trends across regions. The proportion of children who work has been declining
in Southeast Asia given rising per capita incomes, the spread of basic education, and a
reduction in family size but dropping at a slower rate in many countries in Africa.
World : Child labor rates (age 10 - 14)
45
Activity rates (%)
40
35
30
World
25
Asia
20
Africa
15
South America
10
5
0
1940 1950 1960 1970 1980 1990 2000 2010 2020
Year
Figure 1. Child Labor Rates in the World (1940 – 2020). (Appendix A)
44
Maskus, Keith E., Should Core Labor Standards be imposed through International Trade Policy? The
World Bank Development Research Group, August 1997, pp. 14–22.
http://www.worldbank.org/research/trade/pdf/wp1817.pdf
15
Asia : Child labor rates (age 10 - 14)
45
Activity rates (%)
40
35
30
Eastern Asia
25
South Central Asia
20
South-eastern Asia
15
Western Asia
10
5
0
1940
1960
1980
2000
2020
Year
Figure 2. Child Labor Rates in Asia (1940 – 2020). (Appendix A)
But generally, there is a notable decrease in the activity rates of child (ages 10 – 14)
throughout the world. The greatest decrease in child labor rates was observed in Asia
while the decrease was significantly smaller in Africa. (Figure 1.) In Asia particularly, the
decrease in child labor rates was apparent, with Eastern Asia having the fastest decrease
in child economic activity. Child labor was estimated to disappear in Eastern Asia totally
before 2010. (Figure 2.) There are clear decreasing trends in child labor activity in South
Asia as well, except the decrease much less steep.
FDI did have a positive impact on reducing child labor as seen in Figure 3. Regions
with lower levels of FDI per population as in Sub-Saharan Africa had a significantly high
level of child labor rates, while inversely, Latin America and East Asia enjoyed higher
levels of FDI per population, together with lower rates of child labor activity.
16
35
160
30
140
120
25
5
100
80
60
40
20
0
0
20
15
10
FDI/Population
Child labor rates(%)
Histogram of child labor rates and FDI/Population
Child labor rates
FDI/Population
SubSouth AsiaEast Asia & Latin
Saharan
Pacific America &
Africa
Carribean
Regions
Figure 3. Histogram of child labor rates versus foreign direct investment/population. (Appendix B)
From Figure 4, higher GNP per capita was correlated with lower child labor rates.
Developing countries with open economies grew by an average of 4.5 percent per year in
the 1970s and 1980s, while those with closed economies grew just 0.7 percent a year. The
fastest developing region of the world —East Asia — witnessed growth in real per capita
income at an annual average rate of 4 to 6 percent since the 1960s. In China, by the year
2001, per capita GDP had nearly quadrupled since 1980, lifting an estimated 160 million
people from absolute poverty. From 1972 to 2001, the poverty rate in Indonesia has been
more than cut in half. 45 Per capita GDP (in 1997 U.S. dollars) rose from $163 in 1980 to
$235 in 1997 in the least developed countries — a 44 percent increase.46
45
Aaron Lukas, WTO Report Card III: Globalization and Developing Countries (Washington, D.C.: Cato
Institute, June 2000), 2, 4.
46
Tomas Larsson, Stick to the Facts, Please, Ideas on Liberty, July 2000, 21.
17
Child labor rates(%)
35
4500
4000
3500
3000
2500
2000
1500
1000
500
0
30
25
20
15
10
5
0
GNP per capita
Histogram of child labor rates and GNP per capita
Child labor rates
GNP per capita
SubSouth AsiaEast Asia & Latin
Saharan
Pacific America &
Africa
Carribean
Regions
Figure 4. Histogram of child labor rates versus GNP per capita. (Appendix B)
Child labor rates, Illiteracy rates
(%)
Histogram of child labor rates and illiteracy rates
70
60
50
Child labor rates
40
Illiteracy rates-Male
30
Illiteracy rate-Female
20
10
0
SubSaharan
Africa
South Asia East Asia &
Latin
Pacific
America &
Carribean
Regions
Figure 5. Histogram of child labor rates versus illiteracy rates. (Appendix B)
Roles of the multilaterals and international bodies
The Bangladesh garment industry provides an interesting experience of the fight
against child labor. In order to deal with this situation, the Bangladesh Garment
Manufacturers Association (BGMEA) concluded a Memorandum of Understanding
18
(MOU) with the ILO and UNICEF aimed at the elimination of child labor in the garment
industry in June 1995. Under the MOU, the three parties agreed to develop and
implement an experimental monitoring system to remove child workers under the age of
14 from garment factories and to prevent other children from entering employment in
garment factories. As a result, over eight thousand children were successfully removed
from eight hundred garment factories and enrolled in special education programs.47 This
provides a good example of how child labor can be eliminated from specific export
industries without hurting the children who are displaced, although it must be admitted
that industry-specific programs do not address the problem of child labor in its entirety.48
An example of the increased role of trade unions in resource mobilization is that
of the Italian trade unions, along with ILO and UNICEF social partners, where they led
the campaign to raise US$1.8 million. The funds are currently being used by ILO-IPEC
and in Nepal, Bangladesh and Pakistan on projects for the elimination of child labor. This
private initiative approach has encouraged other international and national trade unions to
follow suit. In 1998 the Japanese Trade Union Confederation (JUTC-RENGO)
contributed approximately US$ 40,000 to IPEC. Working closely with other partners,
government and non-governmental organizations, the trade unions have incorporated the
topic of child labor in their worker education programs, and encouraged community
integration activities for purposes of better detection and surveillance of child labor
incidence. Trade unions have undertaken lobbying at both the national and local
IPEC (ILO), Employers’ response to Child Labor: The Bangladesh Garment Manufactures’ Association
(BGMEA) http://www.ilo.org/public/english/standards/ipec/about/factsheet/expls-98/exampl1.htm
48
International Labor Organization, Working Party on the Social Dimensions of the Liberalization of
International Trade, Country studies on the social impact of globalization: Final report, 276th Session,
November 1999.
47
19
government levels for policy reform and improved services for child workers, and
intensified its advocacy activities as well.49
Multinational companies contributing to FDI in developing countries are aware of
the core labor standards and have made efforts to eliminate child labor violations. For
example, the Global Alliance for Workers and Communities is a unique partnership of
business, public and non-profit organizations including NIKE, Inc. Gap, Inc. and the
World Bank. The Global Alliance aims to provide young adults with global
manufacturing ways to improve their lives, workplaces and communities, was launched
April 1999. Frequently, manufacturing for global companies is organized through
contract factories, owned and operated by entrepreneurs who do not necessarily have
cultural or community links to the factory workforce.50 The Global Alliance implemented
a Workers and Communities project at Lian Thai Textile Industrial Co. Ltd, Thailand.
Their report showed “worker satisfaction with regard to safety at work, and that the
workers have a good relationship with management.”51 However, some counter opinions
that challenged Global Alliance’s independence from Nike came from the Thai Labour
Campaign commissioned by Clean Clothes Campaign. Based on a research conducted by
the Thai Labour Campaign into the Nike’s Global Alliance study they uncovered a large
gap between the reality at Lien Thai and the portrait the Global Alliance paints. They
claimed that the report from Global Alliance was biased and failed to outline the
complete context of their findings and the methodology that allowed them to obtain these
49
IPEC (ILO), Workers Taking the Lead in Action Against Child Labor,
http://www.ilo.org/public/english/standards/ipec/about/factsheet/expls-98/exampl1.htm
50
NikeBiz.com, Global Alliance Formed to Enhance Workers’ Lives,
http://www.nikebiz.com/media/n_enhance.shtml.
51
Junya Yimprasert, Lian Thai Industrial and the Global Alliance for Workers and Communities,
September 2000, http://www.cleanclothes.org/companies/nike00-09-15-1.htm
20
results. The Thai Labour Campaign research clearly demonstrated that the Global
Alliance initiative was no substitute for an independent monitoring and verification
system, or for a genuine complaints mechanism that allows workers to voice their
grievances.52
Ways to reduce child labor
Several approaches have been suggested to reduce child labor. The approaches are
not mutually exclusive and probably work best in combination. Policies aimed at
reducing child labor are based on purely economic grounds. Children sent out to work at
an early age do not develop the human capital skills to earn higher wages in the future
and as adults, they have lower productivity levels which become a burden on the
economic growth of their society and country.
As noted, poverty is one of the major causes of child labor. Reduction of poverty
is a long-term process but programs that improve the labor earnings of the poor, address
capital market constraints, and provide safety nets can help reduce child labor in the short
term.53
Education represents the most important means of drawing children away from
the labor market. Education together with poverty reduction can foster human capital
development, with positive economic and social impacts. According to the ILO World
Labor Report, low enrollments in schools are correlated with higher rates of child
employment.54 Therefore, increasing primary school enrollments tends to decrease child
Clean Clothes Campaign, Research into Nike’s Global Alliance Study,
http://www.cleanclothes.org/companies/nike00-09-15.htm.
53
Fallon and Tzannatos, Grootaert, Christiaan, and Ravi Kanbur. Child Labor: A Review World, Bank
Policy Research Working Paper 1454. Washington, D.C. 1998.
http://wbln0018.worldbank.org/HDNet/HDdocs.nsf/f879b8f845ed3915852566500051f549/e4bcc001dba99
537852566b1000a86fa?OpenDocument.
54
ILO (International Labor Office), World Labor Report 1992, Geneva, 1992.
52
21
labor. Making it easier for children to attend work and school simultaneously is a
desirable option and seems particularly relevant in rural areas. The school year must be
carefully scheduled not to conflict with the peak agricultural season. This principle was
applied successfully in Kerala (India) and Vietnam. This can, however, make the school
year too short for example, closure of up to two hundred days a year in Kerala. An
alternative in rural and urban areas is to run night classes, although it is difficult to target
these only for working children.
However, complete abolition of child labor is not totally feasible because the
relationship between poverty and education is very complicated. Though mandatory basic
education is highly desirable on moral grounds, the actual difficulty lies in the
enforcement of this strategy. Children are unable to attend these schools unless there is a
significant improvement in their economic conditions. Strong enforcement, on the other
hand, may threaten the economic welfare of poorer families who heavily depend on the
contribution of child labor as a source of income. Compulsory education can protect
children from exploitative forms of labor since children have to be released to attend
school, but the schedule of school hours must be carefully planned so the children are not
overloaded. Many children go to school and work at the same time. Many of them have
to work in order to attend school because they could not afford the tuition and high costs
associated with attendance. This clearly shows the fact that child labor and education may
work together. A study found that only twenty percent of children in India who dropped
out engaged in paid employment.55 Therefore, immediate elimination of child labor is not
necessarily the solution.
55
Seetharamu, A.S. and U. Devi. Education in Rural Areas: Constraints and Prospects. New Delhi: Ashish
Publishing House, 1985.
22
Schools must make it worthwhile for children to attend in order to make up for
lost earnings. Reducing costs of education via subsidies, direct payments, and school
feeding schemes provide incentives for households to divert child labor into education.
Schools can be made free or serve food supplements. In this case, parents may view this
nutrition as valuable and let their children go to school. The quality of education should
be significantly improved so that education is pertinent for successful careers.56 The costs
and sustainability of this intervention should be further explored.
On a wider spectrum, public awareness towards child labor can be raised by
improving the general awareness of hazards to working children, and raising parental
awareness of the loss of human capital associated with child labor. There is a need for
more cooperation among the local communities, non-government organizations, and
governments to put pressure on employers. Applying pressure on employers alone does
not solve the problem of child labor unless alternative income sources for poor families
are created.
Most nations have laws and regulations governing child labor issues, however,
enforcement is often weak and poses a great problem. It is very unlikely that a ban on
child labor will be very effective in a very poor country where the labor force possesses
little skill. If the wage (adult income) is above the subsistence level, children will not be
sent to work, and if the wage is below this subsistence level, then children will have to
work to supplement their parents’ income. Hence, for wages below subsistence, the labor
supply curve includes children while for wages above subsistence, the labor supply curve
56
Faraaz Siddiqi, Harry Anthony Patrinos, Child labor: Issues, Causes and Interventions, Human
Development and Operations Policy, World Bank.
http://www.worldbank.org/html/extdr/hnp/hddflash/workp/wp_00056.html
23
excludes child workers, as shown in Figure 6.57 For a relatively low-skilled workforce,
represented by the lowest labor demand curve, the economy will be at the lowest point
where labor demand curve intersects the effective labor supply curve. In this case, adult
wage is low and children will be sent to work. For an economy with a relatively highskilled labor force, represented by the uppermost labor demand curve, the intersection of
labor demand and effective labor supply yields a high wage, above subsistence, and
families would not send their children to work. In the situation of a medium-skilled labor
force represented by the labor demand curve in the middle, labor demand curve intersects
the labor supply curve in two places — a higher wage situation where children would not
have to work and a lower-wage situation where children would have to work. If a ban on
child labor was imposed on a relatively low-skilled economy, the labor supply curve
would be one of adults only (left upward-sloping line), adult wage would rise but not
enough to be above subsistence. Children will be sent to work to supplement their
parents’ income. In such a situation where the law is not compatible with incentives of
families, it is likely that an underground market for child labor will emerge and
possibilities of poorer working conditions for the children and corruption cases of official
who have to enforce the ban. On the other hand, if the reduction in labor force due to the
ban drives the adult wage up, families will not send the children to work. In this case, the
ban is self-liquidating and can be used to deflect the economy from a bad situation to a
better one. Thus it is difficult to know if a ban is feasible in a medium-skilled economy
since the consequences of the ban differ so much.
57
Pham Hoang Van, Child Labor in South-East Asia, Cornell University Southeast Asia Outreach Program
http://www.einaudi.cornell.edu/SoutheastAsia/outreach/childlabor/labor1.html
24
The imposition of stringent and across-the-board laws may force the children into
more dangerous and hidden forms of work since these laws may reduce the incomes of
poorer families. Legislation should be more focused on the intolerable forms of child
labor such as slavery and working in hazardous conditions. In June 1999, Convention 182
of the International Labor Organization that targets the elimination of the worst forms of
child labor was adopted. Non-regulatory means to reduce child labor such as trade
sanctions, consumer boycotts, and labeling schemes are controversial. Exports products
in the formal sector are worst hit by trade measures, which may force child workers into
the informal sector where working conditions are typically worse. Trade sanctions are
often a cover for protectionist measures, which may be implemented in discretionary
ways that have little to do with child labor.58
Figure 6. Effects of market forces and ban on child labor.
58
World Development Report 1999/200, Child Labor: how much? How damaging? And what can be done?
Oxford University Press, New York, September 2000, p. 62.
25
Increased awareness in developed countries of child labor problems in the Third World
countries can actually lead to demands for inappropriate action against countries in which
child labor is a serious problem without sufficient attention to the consequences for the
child workers.
Not all child labor is harmful. Children living in a stable environment with their
families or under the protection of a guardian can benefit from informal education and
job training. Economic research has shown that the use of child labor may actually be a
fundamental evolutionary stage in the development of a country. Evidence suggests that
parents have children based on a cost-benefit perspective.59 Children in developing
countries tend to be of economic value and, as a result, become a desirable asset for
struggling parents. Children can significantly contribute to family income. Therefore,
child labor is an intrinsic component of survival in a developing country. After a certain
level of development is reached, children are more of an economic burden and take on
less fiscal importance as contributors. During England's “developing stage”, children's
contributions to family income paralleled those of present Peru and Paraguay. But as a
country develops, children start to consume more than they produce.60 Therefore, the role
of children differs in developed and developing countries. At certain levels of poverty in
developing countries, child labor may play an instrumental role in economic survival,
which augments national economic development.
59
Singh, R. and G.E. Schuh. The Economic Contribution of Farm Children and the Household Fertility
Decisions: Evidence from a Developing Country, Brazil. Indian Journal of Agricultural Economy, 1986,
pp. 29–40.
60
Lindert, P. Child Costs and Economic Development. In R.A. Easterlin, ed., Population and Economic
Change in Developing Countries, The University of Chicago Press, Chicago, 1976.
26
Conclusion
Child labor remains a global issue. Role of multilaterals coupled with the world
economy is pertinent in reducing child labor in the world. The influx of FDI and trade is
one of the most effective and feasible methods of alleviating poverty and, therefore,
reducing child labor. Globalization has been driven by the increasing liberalization of
trade and capital flow especially foreign direct investment. Most importantly, the influx
of capital does not have any negative impact on the labor standards.
Obviously, there is still a child labor problem that is primarily due to cultural
reasons and domestic labor policies. Further progress in reducing child labor will take
place as education levels improve worldwide and more economic and social mobility
occur in developing countries of Asia.
27
Appendix A
Activity rates are obtained from the Economic active population Volume I, II, III, IV, V,
STAT Working Papers, International Labor Organization, Bureau of Statistics (1950 –
2010).
Activity rates represent the percentage of population in the specified age group who are
'economically active'. The "economically active population" comprises all persons of
either sex who furnish the supply of labor for the production of economic goods and
services as defined by the United Nations systems of national accounts and balances,
during a specified time-reference period. According to these systems, the production of
economic goods and services includes all production and processing of primary products,
whether for the market, for barter or for own consumption, the production of all other
goods and services for the market and, in the case of households which produce such
goods and services for the market, the corresponding production for own consumption. It
includes persons in "paid employment" and those in "self-employment" (such as
employers, own-account workers and members of producers' cooperatives, unpaid family
workers, persons engaged in the production of economic goods and services for own and
household consumption, and apprentices who receive pay) as well as members of the
armed forces (including first-time jobseekers).
28
Appendix B
Data was obtained from tables from the World Development Report 2000/2001,
Attacking Poverty.
Definitions
Child labor rates as of 1999 (rates of percent age group, 10-14)
FDI data as of 1998(in millions of dollars)
GNP as of 1999(in millions of dollars)
Adult illiteracy rate - percent of people 15 and above (1998)
29